The Alarming “Sense Of Pauperization” in France

In France, 48% of the people considered themselves either living in poverty or on the way to living in poverty. The sobering results of a survey released just ahead of the National Conference of the Fight against Poverty. It’s going to be a big conference—a sign the government is taking poverty seriously. Prime Minister Jean-Marc Ayrault had announced it in September under the motto, “Imagine the social policies of the 21st century.”

It will take place in Paris on December 10 and 11 at the Iena Palace, home of the Economic and Social Council, which advises the National Assembly and the Senate on social and economic policies. President François Hollande himself will kick it off. Ayrault will close it. Sandwiched between them will be ministers, representatives of anti-poverty associations, and even people who live in poverty. The goal: a roadmap for social questions in Hollande’s five-year term.

It was one of his campaign promises. “The first time that the poverty has become a political topic that a President seizes,” said Bruno Grouès, coordinator of Alerte, an umbrella organization of 35 anti-poverty associations.

The largest consumer companies are already reacting to “the logic of pauperization,” as L’Oréal CEO Jean-Paul Agon had called it. Unilever, the third largest consumer products company in the world, was adjusting its commercial strategy by redeploying to Europe what had worked in poor countries of the developing world. E.Leclerc, the number one retailer in France, confirmed that poverty is a new commercial reality.

In France, poverty is linked to the private sector that is atrophying and shedding jobs. Unemployment numbers have been like Chinese water torture, rising relentlessly since mid-2011 to reach 10.3%—the worst since 1999. Youth unemployment hit 24.9%, the highest since the data series began in 1996. And there is no letup in sight.

The jobs fiasco goes beyond the debt crisis. Unemployment peaked at 11.2% in 1997. The emasculated private sector simply couldn’t participate in the craziness and benefits of the dotcom bubble that was in full swing in the US. After 14 years of Socialist governance—from 1981 to 1995—and nationalization of many of the largest companies, the private sector had lost its oomph. But after a wave of partial privatizations, jobs recovered. Unemployment dropped to 7.5% in the second quarter of 2008, even as the US was sinking into the financial crisis.

President Nicolas Sarkozy gloated on TV: France was immune to the American crisis, he said; under his leadership, it had its act together. By late 2009, unemployment was at 10%. The subsequent jobs recovery was as feeble as it was short, ending in mid-2011 at 9.5%. Unbeknownst to Sarkozy, that was as good as it would get:

The debt crisis was hitting France. Uncertainty took over. The private sector pulled back, and unemployment stormed higher, right in front of Sarkozy’s incredulous eyes. When Hollande took over, unemployment had been getting worse for a year!

It has left its mark on poverty in France, as the dreary CSA survey shows: 37% of the French consider themselves on the way to living in poverty; 11% consider themselves already in it. Only 51% weren’t affected by it. Surprisingly, of the professional categories, “employees” were the hardest hit, with 12% living in poverty and a stunning 48% on the way. A total of 60%! Only 38% considered themselves beyond poverty’s reach.

Jérôme Sainte-Marie, director of the political opinion department at the market research firm CSA, which had conducted the survey, worried that France has “entered a new era.” This was now no longer a question of “lowered status,” he lamented, “but of pauperization.” Many French people not only had the impression of being “worse off than their parents or worse off than hoped,” but they worried “that they could be thrown into misery, if they aren’t already in it.”

The conference and the surrounding fanfare will produce some heartfelt speeches, a few soothing Band-Aids, and perhaps even a laudable roadmap. But it remains doubtful that these measures can, or even attempt to, address the wheezing private sector whose job-creation machine has been demolished. But only a thriving private sector could reverse the jobs fiasco and stem the rising “pauperization.”

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8 comments for “The Alarming “Sense Of Pauperization” in France”

Rik

December 7, 2012 at 9:10 am

European problem but more clear in France. Too many people people having to live of the taxes of the too few people actually working (and if they do it is 35 hour weeks).Has all the dynamic to worsen further. State already with huge deficits cannot spend more, consumers scared for the future and their unfunded pension spend less. Investors faced with taxrises, low demand will not invest. The only way is down.

DADDY WARBUCKS

December 7, 2012 at 1:12 pm

The Euro zone is much like the 'federal' government in the USA:

In the USA one 'federal' dollar spent costs 10 times more than a similarly spent 'state' dollar because of the necessary added bureaucracy (agencies salaries, benefits, pensions, office complexes, information/documentations systems, supplies, vehicles, energy/maintenance costs, etc), also the more complex the bureaucracy the easier it is to siphon off or redirect money for﻿ ideological or corrupt purposes, this money must be replaced.

This happens with every new 'program' while the UN is increasingly allowed to insert itself nationally and locally. These expensive agencies produce nothing and generate no revenue. Now﻿ imagine what an 'INTERNATIONAL'' or 'WORLD' dollar would need to cost you (your higher taxes -absolutely) to fund the 'world' banksters, their bonuses and UN's Agenda 21 to steer all nation's regulatory agencies to regulate and control 'us', our activities, private property, our children's >educations< and be forcibly taxed for their increasingly authoritative bureaucracies by unelected foreign national gOLDMAN sACHS technocrats.

Time to mind our own backyards, our local economies and throw out the 'globalists' and their banks, we need the UN and IMF like we need an infestation of parasitic control freaks.

.

Time for all parents, public and private schools and universities to actively teach students about the NWO 'intellectual elites and world bankers, who they are and their plan to strip us of private property, wealth and all liberty.

Several months ago, I attended a lecture by a French academic who studies and facilitates entrepreneurial activity in France. At that time, the government wanted to create jobs by making it easy and attractive to start new enterprises. One big factor is a vibrant venture capital community. Apart from the capital to invest, VCs bring experience in vetting ideas, guiding company formation and growth and in finding synergies that multiply value. But the VC can only function if his after tax ROI is sufficient to replenish his pool of capital. The tax rate on capital gains is the biggest factor there and what did the new government do? They boosted capital gains taxes.

The government answer will be to provide government capital, but this goes to the heart of Ludwig von Mises and his statement that socialism destroys economic calculation. France may very well destroy net business creation because of its insatiable appetite for government revenues from which it seeks to fund new business formation. The more they do this, the more wealth they destroy. (or the more net debt they pile up)

xaghra

December 7, 2012 at 1:22 pm

Many surveys over the years in France have shown conclusively that the French lie when asked questions in a survey.

JB McMcMunn

December 7, 2012 at 1:54 pm

This is what happens when you believe in magic. The French thought they were immune to arithmetic and decisions being made at the margin.

@December 7, 2012 | xaghra History lesson. Thanks to Napoleon, who was brought to power by Swiss banksters, France has been “enjoying” their version of Federal Reserve for 2 centuries. He, in gratitude to the banksters, created the Central Bank of France.His colonization of Europe and the Middle East was an attempt to set a military version of WTO. One visit to such beautiful French cities as Lyon and Boudreaux will prove without any shadow of a doubt that the French did not lie in this survey.

Wolf Richter

December 7, 2012 at 9:09 pm

TheBuckWheat – you put your finger on one of the issues facing the French private sector. In fact, when the government tried to change the law to tax capital gains in line with earned income, high-tech entrepreneurs, mom-and-pop business owners, artisans, etc., along with VCs, went into a revolt! And got some aspects of the law turned back. Check out my post on this: http://www.testosteronepit.com/home/2012/10/3/a-capitalist-revolt-in-socialist-france.html

Rik

December 8, 2012 at 5:50 am

At the end of the day it is about balls.Modern French men, as recently also scientifically determined, have a very low sperm count. Something probably caused by low male hormone levels. The average Frech male, hardly ever an example of undiluted masculanity, has become even less so.

The French society is simply completely feminised. And a proper European woman works part time as we all know. As she has to think of herself as well as have some time to do some shopping.Another point is that in half the world you have to be male to be able to do business. Russian oligarchs, Chinese party bosses, all male. Look at Hollande, hardly Crocodile Dundy, the new Hulk Hogan or the next contender for heavy weight champion of the world. But definitely one of those that could use a bit of chesthair. It is simply the feminisation of French society that caused the downturn.Also the way French society dealt with one of the few real males left DSK. He simply wouldnot fit into the new feminised straightjacket so French media started a campaign to discredit this last bastion of French masculanity.

To get back to the topic of this post. Most poor are women, a well known fact. So having more poor is another clear example that the France is more and more feminising.